PARIS: France’s manufacturing sector ended a 2½-year slump, offering some hope for the eurozone’s second-biggest economy as it grapples with a renewed bout of political turbulence.
S&P Global’s Manufacturing Purchasing Managers’ Index rose to 50.4 in August from 48.2 in July, bringing it above the 50 threshold separating growth from contraction for the first time since January 2023.
The survey data revealed expansion for consumer and intermediate goods, along with a surprise uptick in employment.
To sustain the improvement it must navigate headwinds beyond its shaky government, including the higher US trade levies locked in by the recent deal between the European Union and President Donald Trump.
“The contraction phase in French manufacturing now appears to be over,” Jonas Feldhusen, an economist at Hamburg Commercial Bank AG, said yesterday in a statement.
“Nonetheless, the situation remains fragile in light of numerous challenges such as tariffs and intense international competition.”
Industry is emerging as a bright spot for France’s economy, which is otherwise suffering from soft domestic demand and weak investment.
The latest figures for output in the sector showed the biggest increase in five years in June, driven by transport materials as supply-chain constraints eased. — Bloomberg
